PRINCIPLES OF BUSINESS MANAGEMENT

The BCG Matrix

(Name)

(Institution Affiliation)

Date of Submission

The BCG Matrix

Introduction

The BGC matrix, also known as the growth-share matrix is a planning model that was developed by Bruce Henderson in the 1970s. Through observations, the BCG matrix is used to classify a company or a business organization in four categories comparing with other competitors.  This matrix compares market growth in an industry and the market share of a specific company or business organization in that industry. Market growth acts as an alternative for industry attractiveness whereas market share acts as a competitive advantage. One of the assumptions of the BCG matrix is that an increase in relative market share leads to increase in the generation of cash. The second assumption is that for a market to grow, there should be an investment in assets that in return leads to increment in capacity. Consequently, companies or business organizations need to use cash for investment in assets. Therefore, the situation of a company in the BCG matrix provides a hint of the company’s cash consumption and cash generation. This paper will analyze the Coca-Cola Company and put the company in its appropriate quadrant in the BCG matrix. On the other hand, the paper will give an explanation for the chosen quadrant.

The Coca-Cola Company is one of the biggest companies in the world that is producing soft drinks. Coca-Cola Company produces a lot of brands of soft drinks ranging from water, Fanta, Sprite, and Minute Maid. Though, the company is facing antagonism from other companies like the Pepsi Company (Foster, 2014). Despite the stiff competition, the appropriate quadrant for the Coca-Cola Company is the “cash cow” quadrant.

Any company in the cash cow quadrant is always a leader in the market. Therefore, such companies or business organizations generate a lot of cash than they consume (Levin, 2013). There are abundant reasons as to why the Coca-Cola Company should be in the “cash cow” quadrant. One of the explanations is that the company has gone international. The company has a wider market share compared to other competing companies such as Pepsi Company. The location of the Coca-Cola Company is in America. However, 76% of its sales come from outside U.S.A. On the other hand, the Coca-Cola Company controls the soft drink market. The company contributes to 59% of the soft drinks in the soft drink world market. Additionally, the business enterprise has invested a lot of money in market research. The company’s innovative product marketers have productively studied the consumers’ values, demographics, and cultures. The market research has enabled the company to satisfy its customers in the USA and all other countries such as African countries (Uddin, 2011). On the other hand, it has enabled the company to expand its market to several countries in the world.

However, despite the Coca-Cola Company being generally at the “cash cow” quadrant, some of its products belong to other parts of the quadrant. For example, Dasani water belongs to the “star” quadrant; the Hi-C drink belongs to the “dogs” quadrant, and the Coca-Cola energy drinks belong to the “question marks” quadrant.

In conclusion, the Coca-Cola Company is one of the biggest companies producing soft drinks in the world. The company has a larger market share as compared to other companies such as Pepsi Company. The paper analyzed the Coca-Cola Company and declared an appropriate quadrant the company belongs.

References

Foster, R. J. (2014). Corporations as Partners: “Connected Capitalism” and The Coca‐Cola Company. PoLAR: Political and Legal Anthropology Review, 37(2), 246-258. 

Levin, R. (2013). Driving the top line with technology: An interview with the CIO of Coca-Cola.

Uddin, M. S. (2011). The Impact of Sensory branding (five senses) on consumer.

 The BCG Matrix

(Name)

(Institution Affiliation)

Date of Submission

The BCG Matrix

Introduction

The BGC matrix, also known as the growth-share matrix is a planning model that was developed by Bruce Henderson in the 1970s. Through observations, the BCG matrix is used to classify a company or a business organization in four categories comparing with other competitors.  This matrix compares market growth in an industry and the market share of a specific company or business organization in that industry. Market growth acts as an alternative for industry attractiveness whereas market share acts as a competitive advantage. One of the assumptions of the BCG matrix is that an increase in relative market share leads to increase in the generation of cash. The second assumption is that for a market to grow, there should be an investment in assets that in return leads to increment in capacity. Consequently, companies or business organizations need to use cash for investment in assets. Therefore, the situation of a company in the BCG matrix provides a hint of the company’s cash consumption and cash generation. This paper will analyze the Coca-Cola Company and put the company in its appropriate quadrant in the BCG matrix. On the other hand, the paper will give an explanation for the chosen quadrant.

The Coca-Cola Company is one of the biggest companies in the world that is producing soft drinks. Coca-Cola Company produces a lot of brands of soft drinks ranging from water, Fanta, Sprite, and Minute Maid. Though, the company is facing antagonism from other companies like the Pepsi Company (Foster, 2014). Despite the stiff competition, the appropriate quadrant for the Coca-Cola Company is the “cash cow” quadrant.

Any company in the cash cow quadrant is always a leader in the market. Therefore, such companies or business organizations generate a lot of cash than they consume (Levin, 2013). There are abundant reasons as to why the Coca-Cola Company should be in the “cash cow” quadrant. One of the explanations is that the company has gone international. The company has a wider market share compared to other competing companies such as Pepsi Company. The location of the Coca-Cola Company is in America. However, 76% of its sales come from outside U.S.A. On the other hand, the Coca-Cola Company controls the soft drink market. The company contributes to 59% of the soft drinks in the soft drink world market. Additionally, the business enterprise has invested a lot of money in market research. The company’s innovative product marketers have productively studied the consumers’ values, demographics, and cultures. The market research has enabled the company to satisfy its customers in the USA and all other countries such as African countries (Uddin, 2011). On the other hand, it has enabled the company to expand its market to several countries in the world.

However, despite the Coca-Cola Company being generally at the “cash cow” quadrant, some of its products belong to other parts of the quadrant. For example, Dasani water belongs to the “star” quadrant; the Hi-C drink belongs to the “dogs” quadrant, and the Coca-Cola energy drinks belong to the “question marks” quadrant.

In conclusion, the Coca-Cola Company is one of the biggest companies producing soft drinks in the world. The company has a larger market share as compared to other companies such as Pepsi Company. The paper analyzed the Coca-Cola Company and declared an appropriate quadrant the company belongs.

References

Foster, R. J. (2014). Corporations as Partners: “Connected Capitalism” and The Coca‐Cola Company. PoLAR: Political and Legal Anthropology Review, 37(2), 246-258. 

Levin, R. (2013). Driving the top line with technology: An interview with the CIO of Coca-Cola.

Uddin, M. S. (2011). The Impact of Sensory branding (five senses) on consumer.